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Malaysia-based independent power producer (IPP) Yinson Renewables has completed a US$59 million green financing deal for a 97MWp solar PV plant in Peru.
Financing for the Peruvian solar PV plant was secured with financial institutions IDB Invest and Natixis Corporate & Investment Banking (CIB). Natixis CIB acted as the sole structuring bank, green loan coordinator and joint lead arranger, alongside IDB Invest.
According to the IPP, the project is the first non-subsidised operational PV plant to secure financing through a green project finance facility.
The project was acquired earlier this year from Spanish IPP Grenergy Renewables. Grenergy also provided the full-turnkey engineering, procurement, and construction (EPC) contract for the construction of the solar plant, and will provide operations and maintenance services for the first two years.
Aside from the Matarani solar plant, Yinson Renewables owns a 130MWp project, at which it expects to start construction by the end of 2024. Across Latin America, the Malaysian-based IPP aims to build a 1GW pipeline of projects in the next three to five years.
The Matarana Solar Project is the fourth utility-scale solar PV operational project for Yinson Renewables, and its first in Latin America. The three other plants are located in India. All four PV plants have a combined operational capacity of 557MW.
The IPP is present in three regions – Latin America, Europe and Asia-Pacific – with a development pipeline of 1.7GW and over 3GW of projects in early-stages opportunities.
Interest in the solar PV market in Peru has been on the rise lately with other IPPs setting targets to build capacity in the country. Renewable energy infrastructure investor Actis launched a new IPP in Peru earlier this year, with the aim to develop 12GW of energy capacity in the country, while power generator Inkia Energy announced a solar PV expansion in Peru last month, with over 1GW of operational capacity set to be in place by the end of 2025.
In a conversation with PV Tech Premium earlier this year, the CEO of renewables developer Verano Energy said that Peru''s potential was "under the radar", with the country having huge potential for renewables and the production of green ammonia.
Vegard Urnes, chief financial officer at Yinson Renewables, said: "We look forward to continue our work in Peru and beyond, leveraging these strong partnerships to drive future projects that contribute to a greener and more resilient energy landscape."
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The financing was arranged by IDB Invest and Natixis Corporate & Investment Banking (Natixis CIB) and is structured in accordance with the Green Loan Principles 2023 [guidelines developed by a working party drawn from leading financial institutions active in the global syndicated loan markets].
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It is a landmark project in Peru’s energy sector as the first non-subsidised operational solar plant financed through a green project finance facility.
Natixis CIB director of infrastructure and energy finance Amaury Chastan stated: "Natixis CIB has a proven track record of financing renewable energy infrastructure in Latin America, and this transaction reinforces our regional and sectorial leadership position. This transaction, structured as a green loan, is completely aligned with Yinson and the Bank''s efforts to support the global energy transition."
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It will deliver 260 gigawatt hours (GWh) of renewable energy annually, equivalent to the electricity consumption of 62,000 Peruvian households.
Yinson Renewables chief financial officer Vegard Urnes stated: "We are thrilled to have successfully executed the mini-perm financing for the Matarani solar project, marking a significant milestone for Yinson Renewables in Latin America. This achievement not only underscores our commitment to advancing renewable energy solutions but also highlights the importance of strategic partnerships with esteemed institutions like IDB Invest and Natixis CIB.
"This collaboration is a testament to our shared vision of fostering sustainable development and addressing climate change. We look forward to continuing our work in Peru and beyond, leveraging these strong partnerships to drive future projects that contribute to a greener and more resilient energy landscape."
Yinson Renewables acquired the project from Grenergy Renewables in January 2024. Grenergy provided a full turnkey engineering, procurement and construction contract for the project, and will provide operation and maintenance services for its first two years.
The solar project supports Peru’s energy transition and its goal of reducing reliance on thermal and hydroelectric power.
IDB Invest CEO James Scriven said: “We are pleased to support Yinson Renewables´ first project in the region. This financing is key to Peru’s energy transition to renewable sources. The Matarani Solar project enhances environmental sustainability and demonstrates the vast potential for non-conventional renewable energy in Peru."
Natixis CIB served as the Sole Structuring Bank, Green Loan Coordinator, and Joint Lead Arranger alongside IDB Invest.
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The Ministry of Energy and Mines (MINEM) has announced the imminent commencement of operations for four renewable energy power plant projects in Peru. These projects, set to add 507 megawatts (MW) to the National Interconnected Electric System (SEIN), represent an investment exceeding $530 million.
Located in the regions of Ica, Arequipa, and Moquegua, these power plants will play a pivotal role in augmenting Peru’s non-conventional renewable energy component, aligning with the national objective of reducing greenhouse gas emissions.
Leading the initiatives is the Clemesí Photovoltaic Solar Power Plant in Moquegua, already in commercial operation with an investment of $95.3 million and an installed capacity of 114.93 MW.
Following suit is the Matarani Photovoltaic Solar Power Plant under construction in Arequipa, slated to add 80 MW to the grid with an investment of $84.8 million.
In Ica, the Wayra Extension Wind Power Plant, with an investment of $222.5 million, will contribute 177 MW upon completion. Additionally, the San Juan Wind Power Plant, also in Ica, is under development with an investment exceeding $129 million and an installed capacity of 135.7 MW.
MINEM underscores the significance of these projects in fortifying Peru’s energy security, fostering job creation across regions, and stimulating the local economy. Moreover, the initiatives aim to leverage Peru’s abundant renewable resources, diversifying the energy matrix and potentially leading to more competitive energy rates in the future.
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